Amended in Assembly August 29, 2016

Amended in Assembly August 19, 2016

Amended in Assembly June 20, 2016

Amended in Assembly June 14, 2016

Amended in Senate April 18, 2016

Amended in Senate March 29, 2016

Senate Bill No. 1241

Introduced by Senator Wieckowski

February 18, 2016

An act to add begin delete Section 1799.208 to the Civil Code, and to add end delete Section 925 to the Labor Code, relating to begin insert employment end insert contracts.

LEGISLATIVE COUNSEL’S DIGEST

SB 1241, as amended, Wieckowski. begin delete Contracts. end delete begin insert Employment contracts: adjudication: choice of law and forum. end insert

begin delete

Existing law, the Consumer Contract Awareness Act of 1990, defines a consumer contract as a writing prepared by a seller that provides for the sale or lease of goods or services or the extension of credit, as specified, for personal, family, or household purposes, among other provisions. The act requires a seller, which includes financial institutions, to deliver a copy of a consumer contract to the consumer at the time the contract is signed, and it prohibits the waiver of any provisions of the act.

end delete begin insert

Existing law regulates the terms and conditions of labor contracts. Existing law prohibits an employer from requiring an employee or applicant for employment to agree, in writing, to any term or condition that is known by the employer to be illegal. Existing law creates the Division of Labor Standards Enforcement, which is under the direction of the Labor Commissioner, and generally commits to the commissioner the authority and responsibility for the enforcement of employment laws.

end insert

This begin delete bill would prohibit, end delete begin insert bill, end insert for contracts entered into, modified, or extended on or after January 1, 2017, begin delete a seller end delete begin insert would prohibit an employer end insert from requiring begin delete a consumer, as a condition of entering into a contract, end delete begin insert an employee who primarily resides and works in California, end insert begin insert as a condition of employment, end insert to agree to a provision that would require the consumer to adjudicate outside of California a claim arising in California or deprive the begin delete consumer end delete begin insert employee end insert of the begin insert substantive end insert protection of California law with respect to a controversy arising in California. The bill would make any begin delete choice of venue or choice of law end delete provision begin insert of a contract that violates these prohibitions end insert voidable, upon request of begin delete a consumer who primarily resides in California, if the provision would violate either of those prohibitions as provided. end delete begin insert the employee end insert begin insert and would require a dispute over a voided provision to be adjudicated in California under California law. end insert The bill would begin delete make end delete begin insert specify that end insert injunctive relief begin insert is end insert available and would authorize a court to award begin delete a consumer end delete reasonable attorney’s fees. The bill would provide that adjudication includes litigation and arbitration for purposes of these provisions. begin insert The bill would except from these provisions a contract with an employee who was represented by legal counsel, as specified. end insert

begin delete

This bill also would create an analogous set of rights, prohibitions, and requirements, as described above, in connection with employment contracts for an employee who primarily resides and works in California. The bill would except from these employment provisions a contract with an employee who is represented by legal counsel, as specified, or a talent agency, as defined.

end delete

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

begin delete

SECTION 1.  

Section 1799.208 is added to the Civil Code, to
read:

1799.208.  

(a) A seller shall not require a consumer, as a
condition of entering into a contract, to agree to a provision that
would do either of the following:

(1) Require the consumer to adjudicate outside of California a
claim arising in California.

(2) Deprive the consumer of the protection of California law
with respect to a controversy arising in California.

(b) Notwithstanding any other law, any choice of venue or
choice of law provision is voidable, upon request of a consumer
who primarily resides in California, if the provision would do
either of the following:

(1) Require the consumer to adjudicate outside of California a
claim arising in California.

(2) Deprive the consumer of the protection of California law
with respect to a controversy arising in California.

(c) If a provision is rendered void at the request of the consumer,
as described in subdivision (b), the matter shall be adjudicated in
California and California law shall govern the dispute.

(d) In addition to injunctive relief and any other remedies
available, a court may award a consumer who is enforcing his or
her rights under this section reasonable attorney’s fees.

(e) For purposes of this section, adjudication includes litigation
and arbitration.

(f) This section shall apply to a contract entered into, modified,
or extended on or after January 1, 2017.

end delete

begin delete SEC. 2. end delete

begin insert SECTION 1. end insert   

Section 925 is added to the Labor Code, to read:

925.  

(a) An employer shall not require an employee begin delete or job
applicant, end delete begin insert who primarily resides and works in California, end insert as a
condition of employment, to agree to a provision that would do
either of the following:

(1) Require the employee to adjudicate outside of California a
claim arising in California.

(2) Deprive the employee of the begin insert substantive end insert protection of
California law with respect to a controversy arising in California.

begin delete

(b) Notwithstanding any other law, any choice of venue or
choice of law provision is voidable, upon request of an employee
who primarily resides and works in California, if the provision
would do either of the following:

(1) Require the employee to adjudicate outside of California a
claim arising in California.

(2) Deprive the employee of the protection of California law
with respect to a controversy arising in California.

(c) If a provision is rendered void at the request of the employee,
as described in subdivision (b), the matter shall be adjudicated in
California and California law shall govern the dispute.

end delete begin insert

(b) Any provision of a contract that violates subdivision (a) is
voidable by the employee, and if a provision is rendered void at
the request of the employee, the matter shall be adjudicated in
California and California law shall govern the dispute.

end insert begin delete

(d)

end delete

begin insert (c) end insert  In addition to injunctive relief and any other remedies
available, a court may award an employee who is enforcing his or
her rights under this section reasonable attorney’s fees.

begin delete

(e)

end delete

begin insert (d) end insert  For purposes of this section, adjudication includes litigation
and arbitration.

begin delete

(f)

end delete

begin insert (e) end insert  This section shall not apply to a contract with an employee
who is in fact individually represented by legal counsel in
negotiating the terms of an agreement to designate either the venue
or forum in which a controversy arising from the employment
contract may be adjudicated or the choice of law to be applied.

begin delete

(g) This section shall not apply to a contract for which the
employee was represented by a talent agency, as defined in
subdivision (a) of Section 1700.4.

end delete begin delete

(h)

end delete

begin insert ( end insert begin insert f) end insert  This section shall apply to a contract entered into, modified,
or extended on or after January 1, 2017.